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July 28, 2011

Transfers to Spouse Not Presumed to be under Undue Influence

The Mississippi Supreme Court has ruled that a lifetime transfer of property to a spouse is not presumed to be because of undue influence. Typically, the law provides that transfers of assets to a person with a confidential relationship to the giver are presumed to be due to undue influence by the reciever. So, for example, when a parent gives the majority of their wealth to their caregiver child, to the exclusion of their other children, the excluded children can claim that the caregiver child influenced the transfer. Because the caregiver child is in a confidential relationship with the giver, the presumption is that the transfer is the result of undue influence. That presumption then, must be overcome by evidence from the gift reciever that the gift was made of the giver's free will, and not the result of undue influence. In the case of Langston v. Williams however, the giver was not a parent, but a spouse. The parent later died and the children sued their decedent's spouse. The Court held that, in the case of transfers between husbands and wives, there is not an automatic presumption of a undue influence, despite the existance of a confidential relationship. This brings the state's rule in line with the rule for testamentary gifts as well. So, where a challenge is made against the spouse of a giver, whether the gift is by will or lifetime transfer, the burden falls on the person challenging the transfer. No presumption arises against a spouse. But, that does not mean that a gift made under undue influence cannot be reversed, merely that the burden of proving it is on the challenger, not the spouse gift recipient.